Employers make enough profits to compensate their employees with wage increases of 5 to 7%. That’s what DNB chief Klaas Knot thinks. Previously he has been involved in the heated salary battle, but has not yet ventured into concrete salary percentages.
And he’s right, thinks labor economist Ronald Dekker of TNO. “This was also said by DNB’s chief economist a few days ago,” he says. “So they have reports that show that the average profit position of Dutch companies is good enough to handle this kind of increase.”
Still, according to Dekker, that’s still a surprising statement. “I’ve never experienced that before,” he continues. “It should be noted, however, that Knot will not yet be sitting in the chair of the union movement.”
True
The percentages quoted by Knot can in fact be defined as realistic, although according to Dekker two meanings can be discovered. “On the one hand, whether it makes sense to agree on such wage increases,” he continues. “I share Klaas Knot’s opinion that it is really logical, but it is also true that wages are still falling in real terms. After all, inflation is above 5-7 percent.’
But, Knot argues, that decline is temporary. He says inflation will fall to a high of 5% in 2023 and 2024. And that’s exactly what Knot simply can’t predict, says Dekker. “However, these kinds of estimates play a big part in how this should be looked at. If inflation is expected to return to a more bearable level, I’ll gladly take it for granted. I don’t know, and nobody really knows.’
Ritual dance
Dekker doesn’t dare mention why Knot is making these statements now, even though he says it’s part of the “ritual dance around collective bargaining.” “Everyone uses whatever they think they can use to get the best possible out of the fire.”
Employers could therefore see Knot’s statements as adding fuel to the fire, Dekker concludes. ‘But I think the people at FNV think ‘fuel on the fire, it just says logical things,’ he concludes.
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
